Prosperity Plus Management Consulting, Inc.
P.O. Box 85
Smithtown, NY 11787
Achieve your goals by improving profit, cash flow and growth.
The Characteristics of Entrepreneurs
What makes a successful entrepreneur? This can be an elusive question. When you look around you see business owners with all different levels of success. Some have booming businesses while others seem to be just plodding along. What sets the most successful apart from the others? Do overachievers share any characteristics that can be duplicated by others? In my travels and studies I’ve come across a handful of characteristics that I believe provide some insight.
It often starts with a willingness and comfort level with taking risks. Many successful entrepreneurs actually thrive on taking risks. It gets their blood pumping and adds a level of excitement to life. While some folks would cringe at the thought of taking out a million dollar loan to start or expand a business these folks welcome the challenge. I’ve seen this in action in many areas. For example, the business owner who takes a loan against his house to buy another dealership or the principal who buys a couple hundred thousand dollars of product from her vendor to secure the best possible price. I have also seen that the willingness to take risks is something that can develop over time. One can start with smaller risks, i.e. hiring that additional sales rep when cash flow is tight. Success then brings about more confidence and the willingness to take bigger risks.
The next characteristic I’ve seen is the strong need for goal achievement. Interestingly enough, this goal achievement is not only in the business world. Strong entrepreneurs tend to focus on goal achievement in all areas of their life. In my opinion this has an underlying corollary; goal setting. It would seem obvious that one has to set goals in order to achieve them. However, I can tell you from 30 years of experience in the business systems industry that too many dealership owners don’t set specific goals. They often have undefined goals like grow the business, be profitable, etc. The problem with ambiguous goals is that it is difficult to know when you’ve achieved them. The most successful entrepreneurs set specific goals and tirelessly drive toward them. They are often quite upset when they fall short.
While setting goals is very important, successful entrepreneurs take it a step further. They focus on execution and driving plans forward. There is rarely a shortage of good ideas for growing or improving a business. Spend a few minutes at the bar during any trade show and you’ll hear plenty of grand ideas. However, if you were to check in with many of these big idea dreamers you’ll find that they went back home and did nothing to execute the plan or idea. Strong entrepreneurs get back and hit the ground running. They will have a meeting on Monday morning to outline what will be done and will relentlessly drive the execution throughout the company.
As stated above, successful entrepreneurs start with setting goals and follow this up with a drive to execute the goals. But there is a third step to this series of characteristics. They always measure the results in all areas of the business and manage the business based on measurable results. While spending time with very successful business people I have noticed that they always have a series of key statistics they are tracking and managing toward. They can tell you the numbers from the top of their head. They know what activity leads to measurable results and what activity is merely busy work. They instill this results-oriented culture throughout the business and base employee and management rewards on results.
The next characteristic I’ve seen is a hard wired need for control. Strong entrepreneurs are not content playing a passive role and rarely do well taking orders from others. This reminds me of one business owner who had brought me in to help him sell his business. He recognized this in himself to the point where he joked with the president of the acquiring company; asking if he understood that he, the entrepreneur, was unemployable. It is important to understand that the need for control should not be confused with the need to personally do everything. These are two different things. Strong entrepreneurs very often need and want full control but are able to delegate well. They exercise their control in their follow up and management of others to achieve the desired goals.
Another interesting characteristic I’ve observed is the ability to tolerate a lot of ambiguity. As the saying goes, it can be lonely at the top. As the leader of a company you don’t have the luxury of sitting back and waiting for someone to tell you what to do. By definition ambiguity means the quality of being ambiguous or open to more than one interpretation. There are always multiple directions one can go when managing a company. Strong entrepreneurs thrive on this ambiguity. They evaluate situations quickly and come to workable conclusions. There are usually excellent problem solvers. Where others can be paralyzed by indecision they can step in and make a quick and emphatic decision.
Though there are likely many more, the final characteristic I’ll cover is a high level of innovativeness. Strong entrepreneurs have a way of coming up with innovative solutions to problems where others struggle. It could be a solution for customer issues, a sales approach no one else has thought of or a plan for recruiting top notch employees. I recall one client that was struggling to take business away from a major competitor. The owner decided to start a new program around response time. They guaranteed four-hour response time, as many do, but he added an innovative component; if they didn’t make it in four the customer would get a refund for one month of their service contract. This innovative twist became the focal point of their service offering and brought in a lot of business.
You may be reading this and thinking you have some of these characteristics but not all of them. If so, you’re not alone. There are different degrees of each of these in every business owner. It is important to understand that not all business owners are the same. I was at a conference recently where a speaker talked about three different types of entrepreneurs; mountain climbers, freedom fighters and crafts people. The difference between them is their basic goal. When asked what they are looking to achieve mountain climbers often answer top-line sales growth, freedom fighters usually answer bottom line profit while crafts people want to be known as being the best in their field. I see all three types in the office systems industry. There is no right or wrong model or goal to follow. The key is to understand yourself enough to know what you want and what you can do to achieve it. Hopefully you’ve gotten some ideas here that can help direct your actions towards the goals you most want to achieve.